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Market Report

Tuesday, 02-Aug-2016

NSE

  • The Sensex opened flat, but quickly notched up over 150-point gain. The NSE's Nifty50 comfortably traded above the 8,650 level at least till mid-day. After 12 pm, the equity benchmarks displayed a muted trend with both the indices slipping into the red at about 2 pm. The Sensex closed at 27,981.71 today, down 21.41 points, or -0.08 per cent, while the broader Nifty50 fell 13.65 points, or -0.16 per cent, to settle at 8,622.90 today.

  • As clouds of uncertainty hung over the GST bill, which goes to Parliament for approval on Wednesday, the domestic equity market swung between gains and losses on Tuesday before the benchmark indices ended the day flat. Gains in consumer-led stocks on expectations of the GST Bill and above normal monsoon forecast helped cap further downside.

  • The Nifty50 today formed a 'Spinning Top' pattern on the candlestick charts for the second consecutive session, suggesting that the index is seeing supply pressure at higher level after a strong rally. The 50-pack index opened higher for the day and 15 minutes into trading, it hit an intraday high of 8,687. However, lack of conviction among the bulls failed to push the index past the 8,700 mark. The index lost momentum as the bulls turned cautious amid selloff in European markets on banking woes and ahead of Wednesday's crucial debate on GST bill in the Rajya Sabha.

  • Experts believed the market has already factored in the GST bill and a good monsoon outcome. The GST is priced in to a large extent, although once it is tabled and passed, we could see a spurt in stock prices, said Nitasha Shankar of Yes Securities. Even the monsoon data, which has been quite good till now, seems to be priced in. In terms of valuations, if you are looking at one-year forward valuations on Nifty, it is already trending towards 19-20 times, which is quite expensive, said Nitasha.

NIFTY 3-Month

(Data/Charts courtesy NSEI/Yahoo!/iCharts/The Economic Times)